Corporate Governance

One of the most important management issues for the TOMY Group today is maintaining the trust of our stakeholders while offering continual improvements in corporate value and building on sound and transparent management practices. We will make every effort to achieve this through strong corporate governance including enhanced self-check functions, risk management and compliance system, even as we improve operational efficiency.

• TOMY Company, Ltd. (the“Company”) has established an auditor system
• The Company’s director and auditor system consists of 13 directors and five auditors (including five outside directors and four outside auditors).

Systems for Performance of Duties by Directors

1. 1Regular meetings of the Board of Directors shall be convened once each month, while extraordinary meetings of the said Board shall be held as deemed necessary. These meetings shall be used to determine basic policies and strategies for the Group as a whole, as well as issue decisions concerning the performance of important business operations, supervise the performance of business operations and take other steps.
2. 2The Executive Directors Meetings (the“Jyomu-Kai”) shall be held once each week with the purpose of conducting the Group’s business operations and management in smoother and more efficient fashion. The members of the Meetings shall engage in versatile decision-making on matters concerning the overall implementation of Group business management.
3. 3The Advisory Committee has been established as an advisory body to the Representative Director, and is requested to render a broad range of counsel pertaining to the effectiveness of business performance, the reliability of the Group’s financial affairs and other important matters.
4. 4Delegation of authority and other steps taken through the establishment of the “operating officer system” shall be advanced to achieve greater speed and efficiency in the performance of business operations in all managing divisions, under the policies, strategies and supervision of the Board of Directors.
5. 5Mid-term Management strategies shall be established to clarify the basic strategies and management goals over the medium term, with specific measures implemented for the purpose of achieving those goals based on the Business Plan (Budget) for each fiscal year.

Auditing Systems

1. 1Upon the occurrence of matters capable of causing serious losses to the Group (or the threat of the occurrence of such circumstances), the detection of illegal or dishonest actions perpetrated by officers or employees or other conditions requiring reports to auditors, directors or employees shall promptly report upon the said situations to the Board of Auditors.
2. 2Corporate Auditors shall use attendance at regular important meetings, irregular meetings and other occasions to receive reports on management conditions, as well as the status of business performance, financial affairs, internal audit implementation, risk management, compliance and other matters.
3. 3To ensure that corporate auditors maintain a firm grasp of the status of important decision-making and the performance of business operations, systems shall be adopted to enable auditors to attend meetings of the Board of Directors, the Executive Directors Meetings and other important conferences; have access to the minutes of meeting proceedings, circular memos for staff approvals and other documents concerning the performance of important business operations; and be able to request explanations of such matters from directors or employees as deemed necessary.
4. 4Corporate Auditors (or the Board of Auditors) shall engage in exchanges of opinions and information with accounting auditors and the Internal Control & Audit Group with regard to important themes pertaining to auditing and other matters, mutually collaborating to monitor the Group’s internal control conditions..

One of the most important management issues for the TOMY Group today is maintaining the trust of our stakeholders while offering continual improvements in corporate value built on sound and transparent management practices.We will make every effort to achieve this through enhancing corporate governance and continually improving internal control systems.

Compliance System

1. 1The TOMY Group Code of Conduct have been established to clarify that all officers and employees in the organization must not only comply with existing laws and ordinances, but also strive through the implementation of sincere and fair corporate activities to fulfill their social responsibilities. These rules are accompanied with thorough efforts to achieve the widest possible understanding of this stance on the part of officers and employees.
2. 2To both enhance and achieve more thorough status for the Group’s compliance system and risk management system, an arrangement has been adopted in which the Risk/Compliance Committee, a body chaired by President & CEO and comprised of outside directors and outside auditors, has been established to deliberate with regard to important issues concerning risk and compliance, and report upon the results of those discussions to the Board of Directors.
3. 3The Internal Control & Audit Group, an organization under direct control of the President & CEO, shall audit the status of the Group’s compliance and report on the results to the President & CEO and the Board of Auditors as deemed necessary.
4. 4No relationships of any kind shall be maintained with anti-social groups or organizations that threaten social order or the sound activities of the Company, while systematic responses shall be mounted with a firm stance to unreasonable demands and similar situations.

Risk Management

1. 1The Risk/Compliance Committee and the Internal Control & Audit Group been established as the organizations assigned to coordinate all areas of risk management, thereby creating a company-wide risk management system integrated with the internal control system.
2. 2To deal with the occurrence of unexpected circumstances, Crisis Management Headquarters shall be promptly established, with prompt and precision actions taken to both minimize losses and damages and effective measures devised to prevent recurrences of such situations.
3. 3Environment Dept. President Office and Safe & Environment Assurance Office has been established as an organization to deal exclusively with the environment and product safety, with efforts being advanced to strengthen the process of dealing with environmental problems and offering outstanding products that can be used with confidence.

Information Management System

1. 1Information pertaining to the performance of duties by directors shall be recorded and preserved in document or electromagnetic media form, in accordance with the Company’s internal guidelines.
2. 2The Information Security Management Rules has been determined pertaining to the management of information, with measures devised to ensure the reliable protection of information assets, including personal information.
3. 3Strengthening of the disclosure system shall be undertaken in the pursuit of speedy information disclosure and greater transparency throughout the Company’s management.

Group Business Management System

1. 1As a general rule, one or more of the Company’s officers or employees shall be appointed as outside directors or outside auditors of the Group companies. In this capacity, these outside directors and auditors shall engage in monitoring and supervision of the appropriateness of the performance of the business operations at each such company, thereby striving to strengthen the risk management and compliance system of the Group as a whole.
2. 2With regard to the Group management system, a department shall be established to oversee Group company management. This department shall act in accordance with the Company’s internal rules and guidelines in advancing management and guidance activities in response to the characteristics and conditions of each Group company.
3. 3Group-wide related rules shall be prepared with regard to compliance, risk management, information management and other areas, with efforts made to foster awareness of compliance throughout the entire Group and establish a risk management system in reflection of the company-wide perspectives, while such systems being monitored by the Risk/Compliance Committee and the Internal Control & Audit Group.

Ensuring financial report reliability

1. 1To ensure the reliability of financial reports, a specific internal control system is being established for the purpose of preparing pertinent regulations and the effective and appropriate submission of internal control reports in accordance with the Financial Instruments and Exchange Law.
2. 2Continuing evaluations shall be conducted to ensure proper functioning of the internal control system, with implementation of required corrections in cases of deficiencies to uphold compliance with the Financial Instruments and Exchange Law and other related laws and ordinances.

With regard to the basic policy of the internal control system of the Company, please refer to

“Basic Policy Pertaining to Internal Control Systems”（240KB）

Concerning remuneration for directors and corporate auditors, it has been decided by resolution of the General Meeting of Shareholders that the amount of remuneration to directors as a group is capped at \400 million per annum (fixed remuneration) and the amount of remuneration to corporate auditors as a group is capped at \70 million per annum (fixed remuneration).

Additionally, it has also been decided by resolution of the General Meeting of Shareholders that the maximum amounts of remuneration etc. relating to subscription rights to shares issuable as stock options are \200 million per annum for directors as a group and \15 million per annum for corporate auditors as a group for the one year period beginning from the date of the Ordinary General Meeting of Shareholders for each fiscal year.

The actual amount of remuneration etc. to each director and each corporate auditor shall be based on the deliberation and report of the Remuneration Committee, which consists of outside directors and outside corporate auditors, and decided by resolution of the Board of Directors for a director's remuneration or by consultation of the Board of Corporate Auditors for a corporate auditor's remuneration.